From Bryan Caplan at Econlog, one of my favorite blogs:
If we really wanted advance warning (and a chance to mitigate) the next
financial crisis, we wouldn't be banning short-selling; we'd be legalizing
insider trading.
financial crisis, we wouldn't be banning short-selling; we'd be legalizing
insider trading.
What's the tie to security? The banning of short-selling is one example (supposed price-gouging by gas stations is another) where popular, emotional interests interfere with a logical, better alternative. We have similar problems in the security space.